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The Axebridge Group – Trusted Corporate, Trust, and Financial Services Provider with Global Reach, headquartered in Barbados.

Taxation, Reporting Obligations, & Allowances

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In early November 2023, the Prime Minister of Barbados, the Honorable Mia Mottley, introduced the following amendments to the Income Tax Act, Cao. 73, which are scheduled to come into effect on January 1, 2024


Change in tax rates

  • Effective 1 January 2024, the Income Tax Act, Cap. 73 shall be amended to increase the corporation tax rate to 9%. This increased tax rate will impact all corporate entities other than those that fall within the stipulated exclusions under the GloBE Rules.


  • The new corporation tax rate will only be applicable for the portion of profits in income year 2024 that is earned from 1 January 2024.




Small Businesses

Small Business Companies (defined as companies with a gross income at or below BDS$2million/US$1 million) will enjoy a preferential corporation tax rate of 5.5% (there is final discussion being heard as to whether this will be automatic as with prior tiered tax rates or whether the company will have to apply for this status).


International Shipping Industry

The international shipping industry will continue to be taxed under the current tax regime established in 2019 (i.e., at the tiered rates of between 1% and 5.5% shown above). As international shipping income is currently excluded from the application of the GloBE Rules, the exemption afforded to international shipping corporations signals Barbados’ acknowledgment of this industry’s unique features and economic significance.

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The Prime Minister has proposed that stakeholder consultations be conducted with a view to providing recommendations on whether Barbados should contemplate the implementation of a new taxation system tailored specifically to the needs of shipping companies. The proposed changes, if any, would come into effect from the fiscal year 2025.


Insurance Business

The existing corporate tax rates of 0% for Class 1 insurance business and 2% for Class 2 and Class 3 insurance business will remain unchanged.

 

The Income Tax Act does not tax capital gains.  A Company would be liable to tax on profits from the sale of securities only if it trades in securities. Of equal note, dividends from a foreign subsidiary where the Barbados company owns 10% or more of its shares are not taxable in Barbados.

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